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[¶10,460A] In the Matter of Basil J.
Mangano, Northern Hancock Bank & Trust Company, Newell, West Virginia,
Docket No. 91-371k (2-4-92)
Respondent agrees to pay civil money penalty assessed by the FDIC in the
amount of $25,000.
In the Matter of
BASIL J. MANGANO,
Individually, and as a person participating in the conduct of the affairs and as an institution-affiliated party of
NORTHERN HANCOCK BANK & TRUST CO.
NEWELL, WEST VIRGINIA
(Insured State Nonmember Bank)
NOTICE OF ASSESSMENT OF CIVIL MONEY PENALTIES, FINDINGS OF FACT AND
CONCLUSIONS OF LAW, ORDER TO PAY, AND NOTICE OF HEARING
FDIC-91-371k
NOTICE OF ASSESSMENT OF CIVIL MONEY PENALTIES
The Federal Deposit Insurance Corporation ("FDIC") is of the opinion
that Basil J. Mangano ("Respondent"), individually, and as a person
participating in the conduct of the affairs of and/or as an
institution-affiliated party of the Northern Hancock Bank & Trust Co., Newell,
West Virginia ("Bank"), has violated the provisions of an ORDER OF PROHIBITION
FROM FURTHER PARTICIPATION ("ORDER"), docket number FDIC-85-363e, issued by
the Board of Directors of the FDIC against Respondent on September 23, 1986.
Wherefore, the FDIC hereby issues this NOTICE OF ASSESSMENT OF CIVIL MONEY
PENALTIES, FINDINGS OF FACT AND CONCLUSIONS OF LAW, ORDER TO PAY AND NOTICE OF
HEARING ("NOTICE OF ASSESSMENT") pursuant to the provisions of section 8(i)(2)
of the Federal Deposit Insurance Act ("Act"), 12 U.S.C. § 1818(i)(2), and Part
308 of the FDIC's Rules of Practice and Procedure, 56 Fed. Reg. 37,968 (1991)
(to be codified at 12 C.F.R. Part 308). In support thereof, the FDIC finds and
concludes as follows:
FINDINGS OF FACT AND CONCLUSIONS OF LAW
A. GENERAL
1. At all times pertinent to the charges herein, the Bank was a
corporation existing and doing business under the laws of the State of West
Virginia, having its principal place of business in Newell, West Virginia. The
Bank is and has been, at all times pertinent to the charges herein, an insured
State nonmember bank subject to the Act, 12 U.S.C. §§ 1811-1831l, the FDIC's
Rules and Regulations, 12 C.F.R. Chapter III, and the laws of the State of West
Virginia.
2. At all times pertinent to the charges herein, Respondent was a
"person participating in the conduct of the affairs" of the Bank within the
meaning of former section 8(e) of the Act, 12 U.S.C. § 1818(e)(2), current
sections 8(e)(1) and 8(i)(2) or the Act, 12 U.S.C. §§ 1818(e)(1) and 1818(i)(2)
(1989), and/or was an "institution-affiliated party" of the Bank within the
meaning of sections 3(u), 8(e)(1) and 8(i)(2) of the Act, 12 U.S.C. §§ 1813(u),
1818(e)(1) and 1818(i)(2) (1989).
3. Respondent is and was, at all times pertinent to the charges herein,
the principal shareholder of the Bank by virtue of his ownership and control of
40,830 shares or 68.4 percent of the issued and outstanding capital stock of
the Bank.
4. The FDIC has jurisdiction over the Respondent, the Bank and the
subject matter of this proceeding.
B. VIOLATIONS OF THE PROVISIONS OF AN ORDER OF PROHIBITION FROM FURTHER
PARTICIPATION
5. On December 30, 1985, the FDIC's Board of Directors issued a NOTICE
OF INTENTION TO REMOVE FROM OFFICE AND TO PROHIBIT FROM FURTHER PARTICIPATION
("NOTICE"), docket number FDIC-85-363e, against Respondent pursuant to former
section 8(e) of the Act, 12 U.S.C. § 1818(e). The NOTICE was issued by the FDIC
to remove Respondent from his positions as an officer and director of the Bank
as the result of violations of applicable laws and regulations, unsafe and
unsound banking practices, and breaches of fiduciary duty alleged to have been
committed and/or engaged in by Respondent at the Bank.
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6. Subsequently, on August 7, 1986, Respondent entered into a
STIPULATION AND CONSENT TO THE ISSUANCE OF AN ORDER OF PROHIBITION FROM FURTHER
PARTICIPATION ("CONSENT AGREEMENT") with the FDIC.
7. The FDIC's Board of Directors accepted the aforementioned CONSENT
AGREEMENT and on September 23, 1986, issued the ORDER against the Respondent.
The ORDER became effective October 3, 1986.
8. The aforementioned ORDER issued by the FDIC's Board of Directors against the
Respondent contains the following provisions:
[1.]"[B]asil J. Mangano shall not serve or act as a director, officer, or
employee, or vote (directly or indirectly) for any director at Northern Hancock
Bank & Trust Company, or any other bank insured by the FDIC, without the prior
approval of the FDIC, at any time prior to December 31, 1990. Following
December 31, 1990, Mr. Mangano shall not serve or act as a director, officer or
employee or vote for any director at Northern Hancock Bank & Trust Company, or
any other bank insured by the FDIC, unless he has given the FDIC thirty (30)
days' prior written notice of his intention to serve or act in such capacity."
[2.]"[B]asil J. Mangano shall not directly or indirectly solicit or procure, or
transfer or attempt to transfer, or vote or attempt to vote, any proxies,
consents, or authorizations in respect of any voting rights in Northern Hancock
Bank & Trust Company, or any other bank insured by the FDIC, during the life of
the Order, without the prior approval of the FDIC."
[3.]"[B]asil J. Mangano shall not participate in any manner whatsoever,
directly or indirectly, in the conduct of the affairs of Northern Hancock Bank
& Trust Company, or of any other bank insured by the FDIC, at any time prior to
December 31, 1990. Following December 31, 1990, Mr. Mangano shall not
participate in the conduct of the affairs of Northern Hancock Bank & Trust
Company, or of any other bank insured by the FDIC, unless he has given the FDIC
thirty (30) days' prior written notice of his intention to participate."
The ORDER further provides that it will become effective 10 days after the date of
issuance by the FDIC and that the provisions of the ORDER will remain effective
and enforceable except to the extent that, and until such time as, any
provision of the ORDER is modified, terminated, suspended, or set aside by the
FDIC.
9. The ORDER issued by the FDIC against Respondent described in paragraphs 7
and 8 hereof became effective on October 3, 1986, and continued in full force
and effect until December 31, 1990.
10. During the time the FDIC's ORDER against Respondent was in effect,
Respondent attended three of the Bank's annual shareholders' meetings convened
on March 16, 1988, March 15, 1989, and March 15, 1990.
11. At each of the shareholders' meetings specified in paragraph 10 hereof,
Respondent personally represented his 40,830 shares of stock of the Bank and
personally voted his shares of stock to elect the directors proposed by the
Bank's then current management.
12. During the time the FDIC's ORDER against Respondent was in effect, the FDIC
did not modify, terminate, suspend or set aside any provision of the ORDER so
as to authorize the Respondent's actions described in paragraphs 10 and 11
hereof.
13. Respondent willfully violated the specific provisions of paragraphs one and
three of the FDIC's ORDER against Respondent when he participated in the
conduct of the affairs of the Bank by attending the Bank's shareholders'
meetings and personally voted his shares of stock of the Bank on the occasions
and for the purpose specified in paragraphs 10 and 11 hereof.
14. Respondent violated section 8(i)(2)(B) of the Act, 12 U.S.C. §
1818(i)(2)(B), by violating on March 15, 1990, the final order issued pursuant
to section 8(e) of the Act, 12 U.S.C. § 1818(e), as set forth in paragraphs 5
through 13 supra, and said violation by Respondent exhibited a pattern of
misconduct.
ORDER TO PAY
By reason of the violations set forth in the NOTICE OF ASSESSMENT, the
FDIC has concluded that civil money penalties should be assessed against the
Respondent pursuant to section 8(i)(2)(B) of the Act, 12 U.S.C.
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§ 1818(i)(2)(B) (1989). After taking into account the
appropriateness of the penalties with respect to the size of financial
resources and the good faith of the Respondent, the gravity of the violations,
the history of previous violations, and such other matters as justice may
require, it is:
ORDERED, that by reason of the violations set forth in paragraphs 5
through 13 hereof, that a penalty of $25,000.00 be, and hereby is, assessed
against Basil J. Mangano pursuant to section 8(i)(2)(B) of the Act, 12 U.S.C.
§ 1818(i)(2)(B) (1989).
FURTHER ORDERED, that the effective date of this ORDER TO PAY be, and
hereby is, stayed with respect to the Respondent until twenty (20) days after
the date of receipt of the NOTICE OF ASSESSMENT by the Respondent, during which
time the Respondent may file an answer and request a hearing pursuant to
section 8(i)(2)(H) of the Act, 12 U.S.C. § 1818(i)(2)(H) and section
308.19 of the FDIC's Rules of Practice and Procedure, 56 Fed. Reg. 37,968,
37,980 (1991) (to be codified at 12 C.F.R. § 308.19). An original and one
copy of the answer, any such request for a hearing, and all other documents
must be filed in writing with the Office of Financial Institution Adjudication,
1700 G Street, N.W., Washington, D.C. 20552 pursuant to section 308.10 of the
FDIC's Rules of Practice and Procedure, 56 Fed. Reg. 37,968,37,978 (1991) (to
be codified at 12 C.F.R. § 308.10). Copies of all papers filed in this
proceeding shall be served upon the Executive Secretary, Federal Deposit
Insurance Corporation, 550 17th Street, N.W., Washington, D.C. 20429; Arthur L.
Beamon, Associate General Counsel, Compliance and Enforcement, Federal Deposit
Insurance Corporation, 550 17th Street, N.W., Washington, D.C. 20429; and John
J. Rubin, Regional Counsel (Supervision), Federal Deposit Insurance
Corporation, Atlanta Regional Office, 245 Peachtree Center Avenue, N.E. Marquis
One Tower, Suite 1200, Atlanta, Georgia 30303.
If the Respondent fails to file a request for a hearing within 20 days
from the date of receipt of this NOTICE OF ASSESSMENT, the penalty assessed
against the Respondent, pursuant to this ORDER TO PAY, will be final and shall
be paid within sixty (60) days after the date of receipt of this NOTICE OF
ASSESSMENT.
NOTICE OF HEARING
IT IS FURTHER ORDERED that, if the Respondent requests a hearing with
respect to the charges alleged in the NOTICE OF ASSESSMENT, the hearing shall
commence one hundred and twenty (120) days from the date of receipt of this
NOTICE OF ASSESSMENT at Wheeling, West Virginia, or at such other date or place
upon which the parties to this proceeding and the Administrative Law Judge
mutually agree.
The hearing will be public and shall be conducted in accordance with
the provisions of the Act, 12 U.S.C. §§ 1811-1831l, the
Administrative Procedure Act, 5 U.S.C. §§ 551559, and the FDIC's
Rules of Practice and Procedure, 56 Fed. Reg. 37,968 (1991) (to be codified at
12 C.F.R. Part 308). The hearing will be held before an Administrative Law
Judge to be appointed by the Office of Financial Institution Adjudication
pursuant to 5 U.S.C. § 3105. The exact time and location of the hearing
will be determined by the Administrative Law Judge.
In the event the Respondent requests a hearing, he/she shall also file
an answer to the charges in this NOTICE OF ASSESSMENT within twenty (20) days
after the date of receipt of the NOTICE OF HEARING in accordance with section
308.19 of the FDIC's Rules of Practice and Procedure, 56 Fed. Reg. 37,968,
37,978 (1991) (to be codified at 12 C.F.R. § 308.19).
Failure of the Respondent to request a hearing shall render the civil
money penalty assessed in this NOTICE OF ASSESSMENT final and unappealable.
Pursuant to delegated authority.
Dated at Washington, D.C., this 4th day of February, 1992.
